It will seem odd to make the following argument in a review of a book that opens by celebrating American exceptionalism, but the clearest way to understand our current politics is to expand our view and consider the whole Anglosphere. This last term was popularized by Mr. Bennett, so perhaps we're not too far afield after all. At any rate, we in the English-speaking world have a certain uniform dynamic to our politics nowadays that means we can understand ourselves better by looking at each other. And when we do consider the whole, it becomes apparent that we are all groping and stumbling towards the adoption of what has variously been called Compassionate Conservatism, New Labour, New Democrat policies, but can really all be boiled down to the Third Way.

Speaking broadly, the First Way was the rather nakedly capitalistic system pursued until early in the 20th Century. It helped to advance England and America--in particular--to the forefont of industrialization, technology, and business organization globally, but it left the citizenry vulnerable to general economic downturns and particular personal crises like unemployment, illness, old age and death. Because democracy was another vital facet of the Anglosphere, politics gradually had to respond to the demand for a social safety net and the Second Way gathered strength, given a final push to dominance by the spectacular failure of capitalism that produced the Great Depression. If the First Way was premised on personal freedom and free markets, the Second Way was premised on literal social security. It promised a certain level of benefits as a floor below which we would not allow individuals to sink, even if it meant limiting markets, individuals and businesses in ways that had never been permissible previously.

Sadly for its proponents, the anti-capitalist nature of the Second Way proved so damaging to the economy that we arrived at a point--in the 1970's--where the promised benefits could no longer be funded from the profits of business. By the mid-80s, we'd seen the elections of Margaret Thatcher in England, Ronald Reagan in America, Brian Mulroney in Canada, and even Helmut Kohl in Germany and Yasuhiro Nakasone in Japan. Pro-capitalist conservatism, which had been consigned to the ash heap of history in the 60s, had risen across the West, tasked with the revival of economies and the defeat of the quintessential Second Way regime, the USSR.

For the most part this new conservatism did not describe the solution it was adopting to the Second Way problem, indeed, it often seemed like old conservatism, just reacting against the Second Way and pining nostalgically for the First. But there was a new model for it to borrow from, a political-social experiment that happened in the least likely of places, Chile. Faced with a deteriorating economy, Augusto Pinochet had invited the Chicago Boys--Milton Friedman disciples from the University of Chicago--to come help his government initiate free market reforms, These soon made Chile's a uniquely dynamic economy for Latin America. But, as important as the reforms to the economy were the reforms to the social welfare system, which shifted from a focus on benefits to a focus on contributions. In essence, Chile began the great Third Way experiment of having individuals fund their own social safety net. Nor was it just a matter of shifting from defined benefit to defined contribution, it also meant taking advantage of capitalism to allow these social security funds to be invested in markets and exploit the growth opportunities they provide.

On the Anglosphere's periphery, New Zealand and Australia had also experimented with such reforms, but it was Margaret Thatcher--quite clearly influenced by the Chilean example--who introduced a personalized retirement system in Britain and really goosed the transition. Bill Clinton and Newt Gingrich's Welfare Reforms; George W. Bush's Medicare Drug Benefit, HSA rules, housing vouchers, NCLB vouchers and push for personalized Social Security accounts; and Barrack Obama's health care mandate all pushed our politics in the same direction. Meanwhile, Tony Blair won election by being more Thatcher-like than the Tories, as David Cameron was more Blair than Gordon Brown was, as W was more Clinton-like than Al Gore, as Stephen Harper and Benjamin Netanyahu presented themselves as Bush-like reformers, as the current squabbling among Australian leaders on the Left can be reduced to which is best able to cast the party as a more effective version of the Conservatives. Everywhere, the contest is to be identified with the politics of the Third Way--bring First Way mechanisms to bear in order to improve Second Way programs--although internal party politics prevent being openly identified in this way. Indeed, there are so few substantive policy differences between Left and Right in the Anglosphere today that only party partisanship divides them. So aspiring leaders have to pretend to differences that don't exist. And all the while, throughout the Anglosphere we all just keep moving towards more globalized free market economies and more contribution driven social welfare networks.

The time is ripe then for a bold and clear statement that clarifies where we have been and where we are headed and provides a platform for one party or another--or both--to run on and move us further in this direction. America 3.0 comes the closest to fulfilling this demand of any book I've read. But, sadly, it falls short, one suspects, for just the reasons stated above.

In the first instance, the book offers a tremendously lucid and useful discussion of the unique set of circumstances and influences that produced Anglo-Saxon culture. In fact, they play up the Saxon contribution to the point where we might ask if we aren't really citizens of the Saxonsphere. You must read the whole thing, but we can pluck out of it the central Saxon characteristics that the authors celebrate:

*They were free people. [...]

*They owned property individually, not communally, and not as families. [...]

*They traced their lineages through both the male and female line. [...] As a result extended families or clans did not have collective legal rights, or any recognized political role.

*They usually worked together by voluntary association in peacetime, and under coercive authority mainly in wartime.

*In government, they had local rule. [...]

*They restricted the authority of their kings. [...]

*They preferred living in the country, or in dispersed homes, rather than living in large towns.

*They engaged in money transactions.

What's important about this "toolkit" is that, for all the changes to our country and culture, these influences still run deep within it. This means that our future is likely to be shaped by them and a successful politics should counsel policies be in accord with them.

As to those policies, much of what the authors predict seems spot on. They advocate/predict, bringing government budgets into balance, abolishing income taxes, decentralizing workplaces and academics, devolving the current strong national government towards smaller confederations of like-minded regions of states (like New England, except for New Hampshire, or the Pacific States), leaving more of social policy to the states to settle for themselves rather than the Court imposing solutions nationwide, and reducing American involvement in the internal affairs of foreign nations. Most, if not all, of this seems inevitable.

But there's an elephant in the room that they largely ignore, and it leaves a gaping hole in the book. For obviously the social safety net and the set of reforms we can adopt to make it more fiscally stable and financially lucrative must be a major theme of our future politics. And not only are Third Way reforms entirely consistent with those Saxon values they outline but they are suggested by some of the other reforms they advocate and trends that they identify.

First, and foremost, the authors kind of bury their own lede when they state but fail to fully follow-up on the following revolutionary insight:

[T]he entire concept of a "job" is going away. At the time of the Founding, most Americans did not have jobs. There is no reason to think most Americans in the future will have jobs, primarily working at the direction of others employing capital owned by others. Americans are not yet remotely prepared for this shift, either institutionally, or psychologically.

That is certainly true, but the absence of policy proposals to deal with the problems that flow from that reality suggests the authors aren't prepared yet either. For instance, left unspoken in the discussion of ending income taxes and moving to consumption taxes is that the main policy reason for this is to favor, or even force, savings, which is vital to a personalized social safety net.

An even more glaring omission comes in their otherwise entertaining vision of life in 2040. This nearly utopian but excitingly plausible future of abundance and ease can not become a reality unless we determine an alternative means of redistributing the wealth that our society creates to the jobs whereby we currently share capital. Your suburban home, 3-D printer, self-driving car, cheap energy, stable family, and thriving community will not be possible unless you can fund them somehow. And the sorts of discrete freelance tasks they envision us doing from home will not be adequate. We will require some kind of mechanisms to take our general abundance and get it into the hands of private citizens, independent of the concept of the "job" as we now know it.

We already have inklings of how we can start achieving this end, in proposals like former Secretary of the Treasury Paul O'Neill's birth accounts, which would see us set aside money in a private account for every child from birth to age 18, rendering a million dollar cushion for retirement. But we could likewise foster the nuclear family, strong community values, tendency towards private association, property ownership, and other institutions we inherited from the Saxons by rewarding participation in them with account contributions and homestead rights and the like. The potential exists to create a cycle of virtue, where your own affluence would be tied directly to the values and institutions that have made our society so affluent to begin with.
Getting to this Third Way America, or America 3.0, will be much harder than generating the technological innovations that have largely made it possible, and we'll require much more dialogue to get us moving in that direction. This book represents a good beginning, and is excellent on what it is we need to conserve as we move forward, but it is unfortunately very preliminary because of what it leaves out of the discussion.